The Financial Times Guide to Investment Trusts, 2nd Edition

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Competitive fees

Some of the less savoury aspects of our financial sector, including the financial crisis and bankers’ bonuses, have been covered by the media. But there is another area that has deserved similar scrutiny, yet until fairly recently has largely escaped attention – charges. It is generally accepted that unit trusts in particular have historically charged higher fees. Various research and reports have testified to this. Higher fees can only be taken from one source, the fund’s underlying portfolio, which in turn reduces its performance.

Whilst investors cannot influence economic performance or predict market returns, they can control what they pay for their investments. Every penny saved on costs is a penny working towards a better ...